Seplat Petroleum profit climbs on higher prices, output

Seplat Petroleum Development Co PLC said Wednesday its production in 2018 was within guidance as it registered a steep rise in profit and revenue. In 2018, the Nigeria-focused oil and gas producer reported pretax profit of USD238 million compared to USD41 million in 2017. Seplat’s operating profit increased almost tripled to USD310 million from USD112 million.

The company’s revenue increased 65% to USD746 million from USD452 million. Seplat’s full year working interest production increased 35% to 49,867 barrels of oil per day equivalent from 36,923 barrels in 2017. The company previously guided for production to be between 48,000 and 55,000.

For 2019, Seplat is guiding for production of 49,000 barrels of oil equivalent per day to 55,000 barrels. The company’s realised oil price increased 39% to USD70.1 per barrel from USD50.4 with the realised gas price decreasing 1% to USD2.94 per thousand standard cubic feet of gas from USD2.97 in 2017.

Seplat started 2019 with 480.5 million barrels of oil equivalent working interest reserves, slightly ahead of last year. “Seplat has delivered an excellent operational and financial performance resulting in robust profitability and cash flow generation providing us with an extremely solid foundation for growth in the coming years.

At our core assets in the West, OMLs 4, 38 and 41, the extension of the license to 2038 means we can confidently plan and invest long into the future to realise the full potential of those blocks,” said Chief Executive Austin Avuru.

Seplat reinstated its dividend in 2018, paying a special dividend of USD0.05 then an interim dividend of USD0.05. The company declared a final dividend of the same amount taking its total dividend for 2018 to USD0.15. The company said its rig activity will step up “significantly” in 2019 and has set a capital expenditure guidance of USD200 million. Shares in Seplat were down 0.4% Wednesday at 125.00 pence each.